Binance Fined $4.4 Million in Canada for Violating Anti-Money Laundering Laws

Binance has been fined in Canada for violating the country's regulations even though the firm exited the country in 2023.

Written by Radhika Parashar, Edited by David Delima | Updated: 10 May 2024 17:30 IST

Binance Fined $4.4 Million in Canada for Violating Anti-Money Laundering Laws

Photo Credit: Binance

Binance has reportedly not registered itself as a foreign money service business in Canada

Highlights

Binance violated Canada's anti money laundering regulations
The crypto exchange is also facing legal hurdles in Nigeria
Binance is yet to comment on the fine imposed by Canada

Binance has been fined by Canada's anti-money laundering agency for violating the country's anti money laundering laws. The largest crypto exchange in the world was previously probed by the Financial Transactions and Reports Analysis Centre of Canada (FINTRAC) for flouting regulations last year. The action against the firm comes shortly after CEO Changpeng Zhao was sentenced to four months in jail and directed to pay $100 million (roughly Rs. 835 crore) in penalties after pleading guilty to violations of US anti money laundering laws.

The FINTRAC on Thursday released a statement following the punitive action on Binance. The post disclosed that the crypto exchange is being fined for breaching two Canadian rules that were identified over the course of a compliance activity last year.

In its first violation, Binance, headed by Richard Teng, has been accused of failing to register itself as a foreign money services business (FMSB) in Canada. “It should be noted that Binance Holdings Limited was deemed to be an FMSB and was required to be registered with FINTRAC up until September 25, 2023, when it officially ceased all operations in Canada. Up until that day, Binance Holdings Limited was in violation of its registration requirements,” the statement said.

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Meanwhile, Binance is also facing action for failing to report 5,902 accounts of large virtual currency transactions between 2021 and 2023, as is expected from crypto firms in Canada under the anti-money laundering laws.

“Binance failed to report the receipt from a client, of an amount in virtual currency of $10,000 (roughly Rs. 8.5 lakh) or more in the course of a single transaction, together with the prescribed information that occurred on 5,902 separate occasions during the period of June 1, 2021 until July 19, 2023,” FINTRAC said in its statement.

Binance is yet to publicly respond to the fine imposed by FINTRAC following the probe into violation of anti-money laundering regulations in Canada.

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The exchange is currently embroiled into a legal tussle with regulatory authorities in Nigeria. Nigerian authorities summoned Binance authorities last month and asked the firm to establish a physical office in the country.

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Further reading: Binance, Cryptocurrency, Money laundering, Crypto

Radhika Parashar

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Radhika Parashar is a senior correspondent for Gadgets 360. She has been reporting on tech and telecom for the last three years now and will be focussing on writing about all things crypto. Besides this, she is a major sitcom nerd and often replies in Chandler Bing and Michael Scott references. For tips or queries you could reach out to her at RadhikaP@ndtv.com. More